US stocks rise as deals, earnings offset crises

A wave of corporate deals and generally positive quarterly earnings competed for attention this week with gloomy news developments in Ukraine and Gaza, ultimately leading US stocks higher. For the week, the Dow Jones Industrial Average advanced 156.37 points (0.92 per cent) to 17,100.18. The broad-based S&P 500 rose 10.65 (0.54 per cent) to 1,978.22, while the tech-rich Nasdaq Composite Index gained 16.66 (0.38 per cent) to 4,432.15. The week’s gains came despite twin crises that emerged on Thursday when a Malaysian airliner carrying 298 people crashed in Ukraine. Only hours after the plane crashed, Israel launched a ground operation in Gaza, lifting the Palestinian death toll to 296 on Friday, the 11th day of assault that Israel argues is needed to counter Hamas’s terrorist efforts. US stocks nose-dived on Thursday, but surged on Friday even as the US sharpened criticism of Russia’s actions in Ukraine and as Israel warned of a wider Gaza assault.

-Big deals, big earnings-

Major deals this week included a plan unveiled by US tobacco giant Reynolds American to acquire rival Lorillard for $27.4 billion and sell cigarette brands including Salem and Winston to British firm Imperial Tobacco for $7.1 billion. US pharmaceutical giant AbbVie sealed a $54 billion takeover of Dublin-based Shire Pharmaceuticals, which had opposed earlier bids. Whiting Petroleum announced plans to acquire Kodiak Oil & Gas for $6 billion, while Abbott Laboratories sold its branded generics drugs for developed markets to generic drugmaker Mylan for stock valued at $5.3 billion. Rupert Murdoch rocked the media world when his entertainment company, 21st Century Fox, offered $80 billion for Time Warner. Time Warner turned down the bid, but Murdoch is "determined to buy Time Warner," according to a person familiar with the matter. Technology giants IBM and Apple, while avoiding show-stopping mergers, announced what they called a "landmark" partnership to collaborate on applications for Apple's iOS system, which will employ IBM's supercomputing analytics. Analysts were also smiling at the early results from earnings season. Standouts included Dow component Intel, which raised its profit forecast and announced $20 billion in additional share repurchases; Google, which notched a 22 percent increase in revenues behind a surge in "paid clicks"; and Goldman Sachs, which reported $4.10 per share in earnings, beating analyst expectations by more than a dollar, according to AFP.